- A congressional report issued recently argues that efforts by states and cities to go against federal policy on climate change may result in unconstitutional actions.
- Several provisions in the U.S. Constitution preclude states from entering into treaties with foreign nations.
- A cap-and-trade program across states, or a carbon tax, may be better options to address climate change than venturing into agreements with other nations.
More than 200 cities and at least 12 states have announced their plans to support the Paris Agreement, despite President Donald Trump's June bombshell to withdraw from the climate accord. But the anti-Trump climate alliance may have overlooked a crucial impediment — it may be unconstitutional.
A recent report from the Congressional Research Service noted that a climate alliance could be interpreted as states entering into treaties with foreign nations, and it cited one constitutional provision and one legal precedent that may preclude states from making such deals.
The constitutional limits are Article I, Section 10 and the doctrine of foreign affairs preemption.
The relevant clauses of Article I, Section 10 provide that "No State shall enter into any Treaty, Alliance, or Confederation" and that "No State shall, without the Consent of Congress … enter into any Agreement or Compact with another State, or with a foreign power."
The doctrine of foreign affairs preemption, meanwhile, deems a state law unconstitutional if it intrudes on the federal government's power to conduct foreign affairs.
Even backers of the climate alliance have described it as a precedent-setting states' rights issue, but don't view the constitutional issue as insurmountable. In practice, these provisions are more complex than they seem — especially when applied to climate agreements, which for the most part lie in uncharted legal territory. For example, these constitutional limits apply only to "legally binding pacts," according to the U.S. State Department.
This phrasing is key, says Terry Tamminen, CEO of the Leonardo DiCaprio Foundation and former secretary of the California EPA under Arnold Schwarzenegger.
"The Paris Agreement among nations isn't legally binding, but most countries will implement it anyway," Tamminen said. The agreement itself is legally binding; but the provisions for nations to meet climate goals within the climate deal are not. Nations do not face punitive action for failing to follow through.
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The two most notable cases of rebellion — the governor-led United States Climate Alliance and #WeAreStillIn, a commitment signed by city, university and business leaders – are also not legally binding.
Two bills signed by Hawaii's Gov. David Ige, however, use language that directly refers to the "principles and goals adopted" in the Paris Agreement, a detail that could land them in hot water. The state has not formally entered into the accord, but the CRS report suggests that laws which are focused heavily on responding to a foreign affairs event, rather than an "area of traditional state responsibility," may face judicial scrutiny.
The congressional legal analysis also stated that "there is no definitive judicial decision or scholarly consensus on how to differentiate between the treaties, alliances, confederations, and compacts addressed in Article I, Section 10."
The Hawaii governor's office did not respond to a request for comment.
Domestic climate coalitions at the state level can use "cap-and-trade" policies as a constitutionally-viable alternative. On Monday evening, California Democratic Gov. Jerry Brown introduced a proposal to extend California's cap-and-trade program until 2030. And in New Jersey, both the Democratic and Republican gubernatorial candidates favor a reentrance into the Regional Greenhouse Gas Initiative, a nine-state cap-and-trade compact that Gov. Chris Christie pulled out of in 2011.
"Power sector carbon pollution in the RGGI states has declined significantly faster than in the nation as a whole, while independent reports have found that RGGI is creating jobs and generating economic benefits," said Katie Dykes, chair of the RGGI board of directors.
States involved in cap-and-trade also benefit from adding more participants, Dykes said, with larger markets increasing economic efficiency and driving even greater consumer savings and emissions reductions.
There is no legal precedent that can prevent states from linking their cap-and-trade systems with countries like China and regions like the EU, according to Tamminen.
Influential Republicans have their own carbon plan
A group of Republican statesmen led by former Secretary of State James Baker and economist George Schultz has a different plan to combat climate change. The Climate Leadership Council, as the group is known, has stated its support for a carbon tax, calling it a "conservative climate solution" that draws on free-market principles.
The Council's four-pronged strategy would replace the Obama administration's Clean Power Plan, taxing $40 per ton of carbon dioxide and raising an estimated $200 billion to $300 billion a year. Unlike a traditional carbon tax, however, all of the revenue raised would be returned to the American public in the form of monthly dividends, ensuring that households and families are not shouldering the burden of the tax.
The plan also includes border adjustments for the carbon content of imports and exports to countries without comparable carbon pricing systems, punishing nations who "free ride." The final pillar is the dismantling of old carbon regulations to allow U.S. businesses to become more competitive.
"The way we look at it, climate legislation has to have a few key elements in order to get it over the finish line," said Greg Bertelsen, senior vice president of the Climate Leadership Council. A plan must be effective in lowering emissions, be politically viable enough to garner and maintain public support, and ensure that U.S. businesses are able to be competitive.
"There have been many well-intentioned policies of all shapes and sizes, but to date, they have all come up short on one of those key criteria," Bertelsen said. "That's what's so promising about the Baker-Schultz plan. It's a policy that would do all of those things, and also incentivize other countries to fall in line."
The CLC's plan has earned the endorsement of some of the world's largest energy companies and environmental NGOs, including BP, Exxon Mobil, Shell, Total, and GM, as well as Conservation International and The Nature Conservancy.
On the state level, it is an economically proven and constitutional alternative for domestic coalitions to consider. But ultimately, Bertelsen said, climate change is a global issue and the most effective way to address it is at a national level.
— By Zachary Basu, special to CNBC.com